OTTAWA — Steve Verheul used to get under the American trade negotiator's skin.
As Donald Trump's point person on trade in the president's first term, Robert Lighthizer was dead set on overhauling the North American Free Trade Agreement (NAFTA) — a deeply unpopular trade deal in the manufacturing-driven Rust Belt where he grew up.
He ran headlong into a team of stubborn Canadian negotiators led by Verheul, a soft-spoken bureaucrat with a well-known poker face in trade circles. "Every time we thought we were close to finalizing the text, the Canadian negotiators would come back with some cleverly worded caveat designed to undermine the spirit of what had been agreed to at the political level," Lighthizer groused in "No Trade Is Free," the former trade representative's 2023 blueprint for trade policy that offered a glimpse into NAFTA renegotiations.
Eventually, the Americans forged a deal with the Mexicans and Canadians, and in 2018 signed the U.S.-Mexico-Canada Agreement. At the time, Trump considered the USMCA the best pact his country had ever produced.
Now, as Trump slams Canada and Mexico with new tariffs, Verheul and a pair of trade veterans want to save the USMCA.
On Tuesday, the Trump administration slapped 25 percent tariffs on most Canadian and Mexican imports (and a 10 percent levy on Canadian energy imports). Trump also wants to hike duties on Canadian lumber, plans more tariffs on steel and aluminum and has threatened to match any tariff on any American export by any country.
In an interview with POLITICO, Verheul acknowledged the American tariffs and Canadian retaliation "brings the whole issue of the [USMCA] into question."
Earlier this year, some Canadian officials favored an expedited USMCA review. Now, Verheul advises Ottawa to forget it. "I don't think there's any value in Canada showing any interest in any kind of review of the agreement," he says.
Instead, Verheul — now a principal at strategic advisory firm GT and Co. and adviser to Prime Minister Justin Trudeau as a member of the PM's Council on Canada-U.S. Relations — is co-launching the Coalition for North American Trade, a three-nation business group advocating for the long-term benefits of free trade.
The CNAT is the brainchild of Kevin Brady, the Republican former chair of the House Ways and Means Committee. Brady recruited Mexican USMCA chief negotiator Kenneth Smith Ramos to the cause, who then brought on Verheul. Earlier this year, the trio launched their coalition at events in Mexico City and Toronto. Today, they're bringing their pitch to Washington. They're looking for allies who can convince Trump's inner circle to end the trade war with Canada and Mexico.
Canada's allies are out there, even if they're not yet swaying Trump, Verheul says: "I've been hearing from quite a few CEOs in the U.S., quite a few Republicans in the U.S., that they're uncomfortable with the current direction."
But until tariffs disappear, Verheul sees no prospect for productive talks.
"I think the only hope and path forward for countries like Canada and others is that the impact on the U.S. economy, and the stock market, and various companies is going to be extreme enough that there's going to be a lot of pushback within the U.S.," he says.
Canadians have puzzled over the Trump administration's fixation on its northern neighbor. The tariff tiff is officially meant to reduce fentanyl slipping past the border, but Trump has also targeted auto manufacturing, lumber, dairy and the banking sector. (On Wednesday, the administration announced a 30-day pause on auto tariffs.)
The president has complained about lackluster Canadian defense spending. And he's mused about absorbing Canada by "economic force" — a veiled threat that Trudeau has said is Trump's primary motivation in going after Canada.
But Verheul sees the trade war much more simply. It's all about repatriating jobs in the U.S., he said — and Canada is not America's problem. Put simply: "They're targeting the wrong place."
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